Date of Award
Doctor of Philosophy
Managers in multinational companies face a strategic dilemma. They generally want to have full management control over their foreign subsidiaries, at a time when host governments, responding to social and economic forces in their own countries, are enforcing more and more arrangements which require sharing ownership and control.;By comparing successful and less successful joint ventures operating in Mexico, this dissertation attempts to provide empirical evidence on the relationship between parent control and joint venture success. More specifically, it examines how managers in parent companies ensure that their joint ventures meet their expectations.;The study focussed on ten joint ventures (five in petrochemicals, two in hotel management, one in aluminum, one in telecommunications, one in food products and one in the construction industry). The data was collected through in-depth interviews both at the joint venture and the parent level.;This study shows that what managers in parent companies decide to control and how they control it has an impact on joint venture success. Parent companies were able to turn joint ventures around by creating a fit between their criteria of joint venture success, the activities or decisions they controlled and the mechanisms they used to exercise control. Further, this fit was achieved in successful joint ventures while it was not achieved in unsuccessful joint ventures.;Then, the study gives evidence on how managers in parent companies manage the control process. It identifies factors which influence the selection of activities or decisions to control and of control mechanisms. Parent companies were found to exercise control through formal devices such as technology and management contracts on the board of directors, through staffing and more importantly through manipulating the context within which decisions are made and activities carried out.;An understanding of these processes, and of their evolution over time, enabled the researcher to form a set of guidelines which might be helpful to multinational company managers in deciding how to exercise control, if the probability of joint venture success is to be maximized.
Schaan, Jean-louis Francois, "Parent Control And Joint Venture Success: The Case Of Mexico" (1983). Digitized Theses. 1252.